Exhibit 4.1
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TRUST AGREEMENT
TRUST AGREEMENT, between MSDW Structured Asset Corp. (the
"Depositor") and LaSalle Bank National Association (the "Trustee"), made as of
the date set forth in Schedule I attached hereto, which Schedule together with
Schedules II and III attached hereto, are made a part hereof and are hereinafter
referred to collectively as the "Terms Schedule". The terms of the Standard
Terms for Trust Agreements, dated July 7, 1999 (the "Standard Terms") are,
except to the extent otherwise expressly stated, hereby incorporated by
reference herein in their entirety with the same force and effect as though set
forth herein. Capitalized terms used herein and not defined shall have the
meanings defined in the Standard Terms. References to "herein", "hereunder",
"this Trust Agreement" and the like shall include the Terms Schedule attached
hereto and the Standard Terms so incorporated by reference.
WHEREAS, the Depositor and the Trustee desire to establish the
Trust identified in Schedule I attached hereto (the "Trust") for the primary
purposes of (i) holding the Securities, (ii) entering into any Swap Agreement
with the Swap Counterparty and (iii) issuing the Units;
WHEREAS, the Depositor desires that the respective beneficial
interests in the Trust be divided into transferable fractional shares, such
shares to be represented by the Units; and
WHEREAS, the Depositor desires to appoint the Trustee as
trustee of the Trust and the Trustee desires to accept such appointment;
WHEREAS, the Depositor shall transfer, convey and assign to
the Trust without recourse, and the Trust shall acquire, all of the Depositor's
right, title and interest in and under the Securities and other property
identified in Schedule II to the Trust Agreement (the "Trust Property"); and
WHEREAS, the Trust agrees to acquire the Trust Property
specified herein in consideration for Units having an initial Unit Principal
Balance identified in Schedule I attached hereto, subject to the terms and
conditions specified in the Trust Agreement;
NOW THEREFORE, the Depositor hereby appoints the Trustee as
trustee hereunder and hereby requests the Trustee to receive the Securities from
the Depositor and to issue in accordance with the instructions of the Depositor
Units having the terms specified in Schedule I attached hereto, and the Trustee
accepts such appointment and, for itself and its successors and assigns, hereby
declares that it shall hold all the estate, right, title and interest in any
property contributed to the trust account established hereunder (except property
to be applied to the payment or reimbursement of or by the Trustee for any fees
or expenses which under the terms hereof is to be so applied) in trust for the
benefit of all present and future Holders of the fractional shares of beneficial
interest issued hereunder, namely, the Unitholders, and subject to the terms and
provisions hereof and of the Standard Terms.
IN WITNESS WHEREOF, each of the undersigned has executed this
instrument as of the date set forth in the Terms Schedule attached hereto.
LASALLE BANK NATIONAL ASSOCIATION
as Trustee on behalf of the Trust
identified in Schedule I hereto,
and not in its individual capacity
By: /s/ Ann M. Kelly
----------------------------
Name: Ann M. Kelly
Title: Assistant Vice President
MSDW STRUCTURED ASSET CORP.
By: /s/ John Kehoe
----------------------------
Name: John Kehoe
Title: Vice President
Attachments: Terms Schedule (consisting of Schedules I, II and III)
Schedule I
(Terms of Trust and Units)
Trust: SATURNS Trust No. 2002-11
Date of Trust Agreement: October 28, 2002
Trustee: LaSalle Bank National Association.
References to Chase Bank of Texas,
National Association in the Standard
Terms shall be inapplicable.
Units: The Trust will issue two classes of
Units: the Class A Units and the
Class B Units. Only the Class A
Units will be publicly offered.
Initial Unit Principal Balance
of the Class A Units: $39,332,000
Initial Notional Amount
of the Class B Units: $39,332,000
Issue Price of Units: Class A Units: 100%
Class B Units: $7,670,000
Number of Units: Class A Units:
1,573,280 (Unit Principal Balance of
$25 each)
Class B Units:
Initially, one (1) Unit representing
100% of the Notional Amount of the
Class B Units
Minimum Denomination: Class A Units:
$25 and $25 increments in excess
thereof. The minimum denomination
specified in Section 5.01(a) of the
Standard Terms shall not apply to
the Class A Units. Each $25 of Unit
Principal Balance is a Unit.
Class B Units:
$100,000 and $1,000 increments in
excess thereof.
Cut-off Date: October 28, 2002
Closing Date: October 28, 2002
Specified Currency: United States dollars
Business Day: New York, New York and Chicago,
Illinois
Interest Rate: Class A Units:
6.000% per annum on the basis of a
360 day year consisting of twelve 30
day months. During an extension
period with respect to the
Securities, while interest will
continue to accrue on the Unit
Principal Balance at 6.000% per
annum and interest will accrue on
any deferred interest at 6.000% per
annum.
Class B Units:
1.539% per annum on the basis of a
360 day year consisting of twelve 30
day months. During an extension
period with respect to the
Securities, interest will continue
to accrue on the Unit Notional
Amount at 1.539% per annum and
interest will accrue on any deferred
interest at a rate equal to 7.570%
per annum.
The right of the Class A Units to
accrued interest is pari passu with
the right of the Class B Units to
accrued interest from accrued
interest on the securities.
The Class B Units are also entitled
to the Class B Unit Payment
Obligation of the Swap Counterparty
specified in Schedule III.
Distribution of the Class B Unit
Payment Obligation with respect to
the Class B Units shall result in a
reduction of the Notional Amount of
the Class B Units equal to the Class
B Unit Corresponding Portion.
Amounts received by the Trust in
respect of the Class B Unit Payment
Obligation may only be distributed
with respect to the Class B Units.
Interest Reset Period: Not Applicable
Rating: Class A Units and Class B Units:
Aa1 by Moody's
AA by S&P
Rating Agencies: Moody's and S&P
Scheduled Final Distribution Date: December 1, 2045. The Units will
have the same final maturity as the
Securities.
Prepayment/Redemption: The Trust Property is subject to
redemption in accordance with the
terms of the Securities and as
described in Schedule II and is
subject to call in accordance with
Schedule III. Any such call or
redemption will result in the
redemption of a proportional amount
of the Class A Units and a
proportional reduction in the
Notional Amount of the Class B
Units.
If the call rights under the Swap
Agreement are partially exercised or
if there is a partial redemption of
the Securities, (i) the Trustee will
randomly select Class A Units to be
redeemed in full from the proceeds
of such partial exercise of the Swap
Agreement or partial redemption of
the Securities and (ii) the Trustee
will allocate distributions with
respect to the Class B Units and the
corresponding reduction in the
Notional Amount of the Class B Units
(A) (1) if one Swap Counterparty
exercises call rights in connection
therewith, first to such Swap
Counterparty unless such Swap
Counterparty waives this right in
whole or in part, (2) if more than
one Swap Counterparty exercises call
rights in connection therewith,
first to each such Swap Counterparty
pro rata up to an amount equal to
the Class B Unit Corresponding
Portion (based upon the Class B Unit
Corresponding Portion allocable to
each such Swap Counterparty) then to
each such Swap Counterparty pro rata
up to an amount equal to the
remaining amount exercised
(expressed by principal amount of
Securities) by such Swap
Counterparties (based upon the
proportional amount of such
remaining amount allocable to each
such Swap Counterparty) and any such
Swap Counterparty may waive this
right in whole or in part (and its
related exercise shall be excluded
for all purposes of this Clause (A)
to the extent of such waiver) and
then (B) the Trustee shall randomly
select Class B Units or portions
thereof (including Class B Units for
which a Swap Counterparty waived its
rights under clause (A)) for any
remaining amount to be distributed
and the corresponding reduction in
Notional Amount of such Class B
Units.
Additional Distribution: If the Security Issuer gives notice
of a self-tender as to Securities
held by the Trust and the Swap
Counterparty exercises its call
rights under the Swap Agreement
prior to October 28, 2007, each
redeemed Unitholder will receive an
additional distribution of $1.50 per
Class A Unit.
Corporate Trust Office: The definition of "Corporate Trust
Office" in the Standard Terms shall
not apply.
The Corporate Trust Office shall be
the Trustee's Asset-Backed
Securities Trust Services Group
having an office at 135 S. LaSalle
Street, Suite 1625, Chicago,
Illinois 60603 or such other
addresses as the Trustee may
designate from time to time by
notice to the Unitholders, the
Depositor, the Swap Counterparty and
the Guarantor.
Swap Agreement: The ISDA Master Agreement referred
to in Schedule III and any
assignment thereof. In addition, in
connection with an additional
issuance of Units, any additional
Swap Agreement entered into in
connection therewith.
Swap Counterparty: Party A to the Swap Agreement
referred to in Schedule III or any
assignee thereof. In addition, in
connection with an additional
issuance of Units, Party A to any
additional Swap Agreement or any
assignee thereof.
In the event that there is more than
one Swap Counterparty at any time
when a partial redemption of the
Securities occurs, the Trustee shall
randomly select which options under
the Swap Agreements shall be
selected for exercise or termination
(and receipt of a Swap Termination
Payment). If a Swap Counterparty
exercises call rights in connection
with such partial redemption, the
Trustee shall select such Swap
Counterparty for exercise or
termination up to the amount
exercised by such Swap Counterparty
and randomly thereafter. If more
than one Swap Counterparty exercises
call rights in connection with such
partial redemption, the Trustee
shall select among such Swap
Counterparties pro rata (based upon
relative amount exercised) for
exercise or termination up to the
amount exercised by each such Swap
Counterparty and randomly
thereafter.
Guaranty: Morgan Stanley (formerly known as
Morgan Stanley Dean Witter & Co. the
"Guarantor") shall guarantee the
obligations of Morgan Stanley & Co.
International Limited ("MSIL") for
so long as MSIL is Party A to any
Swap Agreement with the Trust.
Swap Notional Amount: The notional amount specified in
Schedule III.
Swap Payment Date: Not Applicable
Swap Rate: Not Applicable
Additional Swap Agreements: In connection with an additional
issuance of Units, the Depositor may
arrange for the Trust to enter into
an additional Swap Agreement with
identical terms to those of the Swap
Agreement entered into as of the
Closing Date, except that such Swap
Agreement may have a different Swap
Counterparty, number of options, and
premium amount than the Swap
Agreement entered into on the
Closing Date. The Rating Agency
Condition must be satisfied prior to
the effectiveness of such additional
Swap Agreement. Each Swap
Counterparty must consent to any
additional issuance.
Distribution Date: Each June 1 and December 1, or the
next succeeding Business Day if such
day is not a Business Day,
commencing December 1, 2002.
If any payment with respect to the
Securities held by the Trust is not
received by the Trustee by 12 noon
(New York City time) on a
Distribution Date, the corresponding
distribution on the Units will not
occur until the next Business Day
that the Trust is in receipt of
proceeds of such payment prior to 12
noon, with no adjustment to the
amount distributed.
Record Date: Each November 15 and May 15,
regardless of whether such day is a
Business Day.
Form: Global Security
Depositary: DTC
Trustee Fees and Expenses: As compensation for and in payment
of trust expenses related to its
services hereunder other than
Extraordinary Trust Expenses, the
Trustee will receive Trustee Fees on
each Distribution Date in the amount
equal to $3,750. The Trustee Fee
shall cease to accrue after
termination of the Trust. The
"Trigger Amount" with respect to
Extraordinary Trust Expenses for the
Trust is $25,000 and the Maximum
Reimbursable Amount is $100,000. The
Trustee Fee will be paid by the
Expense Administrator. Expenses will
be reimbursed by the Expense
Administrator in accordance with the
Expense Administration Agreement.
Expense Administrator: The Depositor will act as Expense
Administrator on behalf of the Trust
pursuant to an Expense
Administration Agreement, dated as
of the date of the Trust Agreement
(the "Expense Administration
Agreement"), between the Depositor
as Expense Administrator (the
"Expense Administrator") and the
Trust.
The Expense Administrator will
receive a fee equal to $6,048
payable on each Distribution Date
(together with any interest as
described in the next sentence, the
"Expense Administrator's Fee"). The
Expense Administrator will be
entitled to interest on any deferred
fee amounts that would have been
payable but for deferral of interest
on the Securities at the rate of
7.570% per annum and any additional
amounts available as interest on
deferred interest with respect to
the Securities after application of
such amounts to the deferred
interest payable on the Units. The
Expense Administrator's Fee is
payable only from available interest
receipts received with respect to
the Securities after application of
such receipts to payment of accrued
interest on the Units.
The Expense Administrator will be
responsible for paying the Trustee
Fee and reimbursing certain other
expenses of the Trust in accordance
with the Expense Administration
Agreement.
Listing: The Depositor has applied to list
the Class A Units on the New York
Stock Exchange.
ERISA Restrictions: None of the restrictions in the
Standard Terms relating to the
Employee Retirement Income Security
Act of 1974, as amended, and related
matters shall apply to the Class A
Units.
The restrictions shall apply to the
Class B Units and no ERISA Benefit
Plan may acquire an interest in the
Class B Units.
Alternative ERISA Restrictions: Not Applicable
Deemed Representations: Not Applicable
QIB Restriction: Applicable to the Class B Units. Not
applicable to the Class A Units.
Trust Wind-Up Event: The Trust Wind-Up Events specified
in Sections 9.01(a), 9.01(c),
9.01(d), 9.01(f) and 9.01(h) shall
not apply. The Trust Wind Events
specified in Sections 9.01(b)
(Security Default), 9.01(e) (Early
Termination Date designated due to
"illegality" or "tax event" under
the Swap Agreement), 9.01(g)
(Disqualified Securities), 9.01(i)
(Excess Expense Event) shall apply.
Pursuant to Section 9.01(j), the
following events also shall
constitute Trust Wind-Up Events: (i)
redemption by the Security Issuer of
all Securities held by the Trust and
(ii) exercise of the call rights
under the Swap Agreement as to all
Securities held by the Trust.
If (i) cash settlement applies under
the Swap Agreement, (ii) a Trust
Wind-Up Event has occurred in
connection with the exercise of any
Option under the Swap Agreement and
(iii) the Selling Agent cannot
obtain a bid for the Securities in
excess of the amount specified in
the Swap Agreement, then the
Securities will not be sold, the
Swap Counterparty's exercise of the
call option will be rescinded (and
the Swap Counterparty shall be
entitled to exercise such options in
the future) and any related Trust
Wind-Up Event will be deemed not to
have occurred.
Termination: If a Trust Wind-Up Event occurs, any
Securities held by the Trust will be
liquidated (by delivery to the
Security Issuer in the event of a
redemption, pursuant to the terms of
the Swap Agreement in the event of
an exercise of the Swap Agreement or
otherwise by sale thereof).
If the related Trust Wind-Up Event
occurs due to a redemption of the
Securities by the Security Issuer or
exercise of the call rights under
the Swap Agreement as to all
Securities held by the Trust, (i)
amounts received as accrued interest
on the Securities will be applied to
the Class A Units and the Class B
Units pro rata in proportion to the
amount of accrued interest
outstanding on each such Class, (ii)
amounts received as principal or par
on the Securities will be applied to
the Unit Principal Balance of the
Class A Units up to 100% of the Unit
Principal Balance of each Class A
Unit, (iii) if prior to October 28,
2007 in connection with a
self-tender, an additional amount of
$1.50 per Class A Unit. Remaining
accrued interest will be applied to
the Expense Administrator's fee. Any
remaining amounts (other than the
Class B Unit Payment Obligation of
the Swap Counterparty) will be paid
to the Swap Counterparty as a Swap
Termination Payment under the Swap
Agreement.
If the Trust is terminated for any
other reason, the proceeds of
liquidation will be applied to
redeem the Class A Units and the
Class B Units. The Class A Units
will have a claim on the proceeds of
the liquidation equal to their
aggregate Unit Principal Balance
plus accrued interest. The Class B
Units will have a claim on the
proceeds of liquidation equal to the
value calculated (x) by discounting
each remaining scheduled payment at
a rate of 7.570% (on the basis of a
360 day consisting of twelve 30 day
months) and adding (y) accrued
interest. If the proceeds of the
liquidation are less than the
combined claim amounts of the Class
A Units and the Class B Units, the
proceeds will be distributed in
proportion to the claim amounts of
the Class A Units and the Class B
Units in full satisfaction of the
claims of the Units. If the proceeds
of liquidation exceed the claims of
the Class A Units and the Class B
Units, the excess will be paid to
the Swap Counterparty as a Swap
Termination Payment under the Swap
Agreement.
Self-Tenders by Security Issuer: The Trust will not participate in
any self-tender by the Security
Issuer for the Securities and the
Trustee will not accept any
instructions to the contrary from
the Unitholders. However, the Swap
Counterparty may exercise its call
rights in connection with any
self-tender in accordance with the
Swap Agreement.
Exchangeable Series Terms: The Exchangeable Series provisions
only apply to the Depositor as a
Unitholder (or beneficial owner of
Units). No Unitholder (or beneficial
owner of a Unit) other than the
Depositor may exchange Units for
Securities.
The Depositor may exchange Units for
a pro rata portion of the Trust
Property (less any amount sold to
pay any swap termination payment or
other fee or payment required by the
Swap Counterparty); provided that:
(i) the exchange is made with
respect to a minimum Unit Principal
Balance of $250,000 and in $25
integral multiples in excess
thereof; (ii) such exchange is to be
effected on any January 1, April 1,
July 1 or October 1 (or the
succeeding Business Day if such date
is not a Business Day) with 45 days
notice; (iii) the Swap Counterparty
consents to the exchange and (iv)
the Expense Administrator consents
to the exchange.
Terms of Retained Interest: Notwithstanding any other provision
herein or in the Standard Terms, the
Depositor retains the right to
receive any and all interest that
accrues on the Securities prior to
the Closing Date. The Depositor will
receive such accrued interest on the
first Distribution Date (or
redemption date if earlier) for the
Units and such amount shall be paid
from the interest payment made with
respect to the Securities on the
first Distribution Date.
The amount of the Retained Interest
is $1,210,806.
If a Security Default occurs on or
prior to the first Distribution Date
and the Depositor does not receive
such Retained Interest amount in
connection with such Distribution
Date, the Depositor will have a
claim for such Retained Interest,
and will share pro rata with holders
of the Units to the extent of such
claim in the proceeds from the
recovery on the Securities.
Call Option Terms: Not Applicable.
Security Default: The definition of Security Default
in the Standard Terms shall not
apply. A "Security Default" shall
mean one of the following events:
(i) the acceleration of the
outstanding Securities under the
terms of the Securities and/or the
applicable Security Agreement and
failure to pay the accelerated
amount on the acceleration date;
(ii) the failure of the Security
Issuer (or the AGC Guarantor or the
AIG Guarantor on its behalf or under
the guaranties) to pay an
installment of principal of, or any
amount of interest due on, the
Securities after the due date
thereof and after the expiration of
any applicable grace period; (iii)
the initiation by the Security
Issuer or the AGC Guarantor or the
AIG Guarantor, so long as the AGC
Guarantor is a subsidiary of the AIG
Guarantor, of any proceedings
seeking a judgment of insolvency or
bankruptcy or seeking relief under
bankruptcy or insolvency laws or
similar laws affecting creditor's
rights; or (iv) if not otherwise
addressed in (iii), the passage of
thirty (30) calendar days since the
day upon which any person or entity
initiates any proceedings against
the Security Issuer or the AGC
Guarantor or the AIG Guarantor, so
long as the AGC Guarantor is a
subsidiary of the AIG Guarantor,
seeking a judgment of insolvency or
bankruptcy or seeking relief under
bankruptcy or insolvency laws or
similar laws affecting creditor's
rights and such proceeding has not
been dismissed prior to such
thirtieth day.
Sale of Securities: If the Trust must sell the
Securities it holds, the Trust will
sell the Securities through the
Selling Agent in accordance with
Section 9.03(b) and the following
terms. The Selling Agent must
solicit at least three bids for all
of the Securities held by the Trust.
The Selling Agent must solicit at
least three of such bids from
registered broker-dealers of
national reputation, but additional
bids may be solicited from one or
more financial institutions or other
counterparties with credit
worthiness acceptable to the Selling
Agent in its discretion. The Selling
Agent will, on behalf of the Trust,
sell the Securities at the highest
bid price received. None of the
Selling Agent, its affiliates or its
agents, may bid for the Securities.
If the Swap Counterparty is not an
affiliate of the Selling Agent, the
Selling Agent will agree at any time
to permit the Swap Counterparty to
purchase the Securities at the
highest bid received by the Selling
Agent.
If cash settlement applies and if
the Swap Counterparty exercises any
of its call rights other than in
connection with a redemption of or a
self-tender for the Securities by
the Security Issuer (or extent
thereof in the event of an exercise
of call rights in excess of the
amount to be redeemed), a number of
Securities corresponding to the
number of call rights exercised by
the Swap Counterparty will be sold
by the Selling Agent on behalf of
the Trust. If the Selling Agent
cannot obtain a bid for the
Securities in excess of the amount
specified in the Swap Agreement,
then the Securities will not be
sold, the Swap Counterparty's
exercise will be rescinded (and the
Swap Counterparty shall be entitled
to exercise such call rights in the
future) and any related Trust
Wind-Up Event will be deemed not to
have occurred.
Additional Issuance of Units: Upon no less than 5 days' notice to
the Trustee, the Depositor may
deposit additional Securities at any
time in exchange for additional
Units in a minimum aggregate amount
of $250,000 (with respect to the
Class A Units issued ) and, if in
excess of such amount, in a $25
integral multiple in excess thereof
(with respect to the Class A Units
issued). The principal amount of
Securities deposited must be in the
same ratio to the Unit Principal
Balance (and Notional Amount with
respect to the Class B Units) of the
Units received for such deposit as
the ratio of the aggregate principal
amount of the Securities deposited
on the Closing Date to the aggregate
Unit Principal Balance (and
aggregate Notional Amount with
respect to the Class B Units) on the
Closing Date. The Depositor must
either arrange for the Swap
Counterparty and the Trust to
increase proportionally the notional
amount under the Swap Agreement or
arrange for an additional Swap
Agreement, with a notional amount
equal to the principal amount of the
additional Securities deposited, to
be entered into between the Trust
and an additional Swap Counterparty
(or a combination of an additional
Swap Agreement and a notional
balance increase of the existing
Swap Agreement(s), with the combined
effect of such proportional increase
in the notional amount of the Swap
Agreements). The Depositor must also
arrange the issuance of Class B
Units with a Notional Amount equal
to the Unit Principal Balance of the
Class A Units being issued in
connection with an additional
issuance. Any accrued interest will
be reflected in the price of
additional Units and the Securities.
The Rating Agency Condition must be
satisfied in connection with any
such additional issuance. Each Swap
Counterparty must consent to any
additional issuance.
Selling Agent: Morgan Stanley & Co. Incorporated.
Notwithstanding any provision of the
Standard Terms to the contrary, any
sale of the Securities shall be
conducted by and through the Selling
Agent and not the Trustee.
Rating Agency Condition: The definition of Rating Agencies
Condition in the Standard Terms
shall not apply.
"Rating Agency Condition": With
respect to any specified action or
determination, means receipt of (i)
oral or written confirmation by
Moody's (for so long as the Units
are outstanding and rated by
Moody's) and (ii) written
confirmation by S&P (for so long as
the Units are outstanding and rated
by S&P), that such specified action
or determination will not result in
the reduction or withdrawal of their
then-current ratings on the Units;
provided, however, that if the
Rating Agency Condition specified
herein is to be satisfied only with
respect to Moody's or S&P, only
clause (i) or clause (ii) shall be
applicable. Such satisfaction may
relate either to a specified
transaction or may be a confirmation
with respect to any future
transactions which comply with
generally applicable conditions
published by the applicable rating
agency.
Eligible Account: The definition of "Eligible Account"
in the Standard Terms shall not
apply.
"Eligible Account": A non-interest
bearing account, held in the United
States, in the name of the Trustee
for the benefit of the Trust that is
either (i) a segregated account or
segregated accounts maintained with
a Federal or State chartered
depository institution or trust
company the short-term and long-term
unsecured debt obligations of which
(or, in the case of a depository
institution or trust company that is
the principal subsidiary of a
holding company, the short-term and
long-term unsecured debt obligations
of such holding company) are rated
P-1 and Aa2 by Moody's, A-1+ and AA
by S&P, and, if rated by Fitch, F1
and AA by Fitch at the time any
amounts are held on deposit therein
including when such amounts are
initially deposited and all times
subsequent or (ii) a segregated
trust account or segregated accounts
maintained as a segregated account
or as segregated accounts and held
by the Trustee in its Corporate
Trust Office in trust for the
benefit of the Unitholders.
Permitted Investments: The following shall be a Permitted
Investment in addition to the
investments specified in the
Standard Terms:
Units of the Dreyfus Cash Management
Fund Investor Shares or any other
money market funds which are rated
in the highest applicable rating
category by each Rating Agency (or
such lower rating if the Rating
Agency Condition is satisfied).
Amendment of Trust Agreement: Section 12.01(a) of the Standard
Terms shall be replaced with the
following:
(a) The Trust Agreement may be
amended from time to time by the
Depositor and the Trustee without
the consent of any of the
Unitholders, upon delivery by the
Depositor of an Opinion of Counsel
acceptable to the Trustee to the
effect that such amendment will not
materially and adversely affect the
interests of any holder of a Class
of Units that is not voting with
respect to such amendment pursuant
to Section 12.01(b), for any of the
following purposes: (i) to cure any
ambiguity or defect or to correct or
supplement any provision in the
Trust Agreement which may be
defective or inconsistent with any
other provision in the Trust
Agreement; (ii) to provide for any
other terms or modify any other
terms with respect to matters or
questions arising under the Trust
Agreement; (iii) to amend the
definitions of Trigger Amount and
Maximum Reimbursable Amount so as to
increase, but not decrease, the
respective amounts contained in such
definitions or to otherwise amend or
waive the terms of Section 10.05(b)
in any manner which shall not
adversely affect the Unitholders in
any material respect; (iv) to amend
or correct or to cure any defect
with respect to the Trustee Fee or
Expense Administrator's fee; (v) to
evidence and provide for the
acceptance of appointment under the
Trust Agreement by a successor
Trustee; or (vi) to add or change
any of the terms of the Trust
Agreement as shall be necessary to
provide for or facilitate the
administration of the Trust,
including any amendment necessary to
ensure the classification of the
Trust as a grantor trust for United
States federal income tax purposes;
provided, however, that in the case
of any amendment pursuant to any of
clauses (i) through (vi) above, the
Rating Agency Condition shall be
satisfied with respect to such
amendment. If more than one Class of
Units has been issued under the
Trust Agreement, the provisions of
this Section 12.01(a) shall apply to
each Class of Units that is not
materially and adversely affected by
such amendment.
Section 12.01(c) shall be
re-designated Section 12.01(d).
Section 12.01(b) shall be
re-designated Section 12.01(c).
The following shall constitute
Section 12.01(b):
(b) The Trust Agreement may be
amended from time to time by the
Depositor and the Trustee with the
consent of a 100% of the outstanding
Unit Principal Balance of each Class
of Units materially and adversely
affected thereby. The Rating Agency
Condition shall be satisfied with
respect to such amendment unless
Units representing 100% of the Unit
Principal Balance of all affected
Units vote in favor of such
amendment with notice that the
Rating Agency Condition will not be
satisfied.
The following shall constitute
Section 12.01(e):
(e) For purposes of this Section
12.01, Schedule III to any Trust
Agreement and any Swap Agreements
entered into in connection with any
related Trust shall not be
considered part of the Trust
Agreement. Section 7.02 shall govern
action taken under the Trust
Agreement with respect to any
amendments to such Swap Agreements.
Securities Intermediary: LaSalle Bank National Association
acting in the capacity of securities
intermediary.
Additional Representations
Of Trustee and Securities
Intermediary: The Unit Account is a "securities
account" within the meaning of
Section 8-501 of the UCC and is held
only in the name of the Trust. The
Securities Intermediary is acting
with respect to the Unit Account in
the capacity of a "securities
intermediary" within the meaning of
Section 8-102(a)(l4) of the UCC.
All Securities have been (i)
delivered to the Securities
Intermediary pursuant to the Trust
Agreements; (ii) credited to the
Unit Account; and (iii) registered
in the name of the Securities
Intermediary or its nominee,
indorsed to the Securities
Intermediary or in blank or credited
to another securities account
maintained in the name of the
Securities Intermediary. In no case
will any Securities or other
financial asset credited to a Unit
Account be registered in the name of
the Depositor, payable to the order
of the Depositor or specially
indorsed to the Depositor except to
the extent the foregoing have been
specially indorsed to the Securities
Intermediary or in blank.
The Unit Account is an account to
which financial assets are or may be
credited, and the Securities
Intermediary shall treat the Trustee
as entitled to exercise the rights
that comprise any financial asset
credited to the account.
The Securities Intermediary hereby
agrees that the Securities credited
to the Unit Account shall be treated
as a "financial asset" within the
meaning of Section 8-102(a)(9) of
the UCC.
If at any time the Securities
Intermediary shall receive any order
from the Trustee directing the
transfer or redemption of any
Securities on deposit in any Unit
Account, the Securities Intermediary
shall comply with such entitlement
order without further consent by the
Depositor or any other Person. The
Securities Intermediary shall take
all instructions (including without
limitation all notifications and
entitlement orders) with respect to
each Unit Account solely from the
Trustee.
The Securities Intermediary hereby
confirms and agrees that:
(a) There are no other agreements
entered into between the Securities
Intermediary and the Depositor with
respect to any Unit Account;
(b) It has not entered into, and
until the termination of this
Agreement will not enter into, any
agreement with any other Person
relating to any Unit Account and/or
any financial assets credited
thereto pursuant to which it has
agreed to comply with entitlement
orders (as defined in Section
8-102(a)(8) of the UCC) of such
other Person; and
(c) It has not entered into, and
until the termination of the Trust
Agreements will not enter into, any
agreement with the Depositor or the
Trustee purporting to limit or
condition the obligation of the
Securities Intermediary to comply
with entitlement orders as set forth
above
The Trustee hereby represents and
warrants as follows:
(a) The Trustee maintains its books
and records with respect to its
securities accounts in the State of
Illinois; and
(b) The Trustee has not granted any
lien on the Securities nor are the
Securities subject to any lien on
properties of the Trustee in its
individual capacity; the Trustee has
no actual knowledge and has not
received actual notice of any lien
on the Securities (other than any
liens of the Trustee in favor of the
beneficiaries of the Trust
Agreements); other than the
interests of the Unitholders and the
potential interests of the Call
Option holders, the books and
records of the Trustee do not
identify any Person as having an
interest in the Securities.
The Trustee makes no representation
as to (i) the validity, legality,
sufficiency or enforceability of any
of the Securities or (ii) the
collectability, insurability,
effectiveness or suitability of any
of the Securities.
Additional Depositor
Representations: The Depositor hereby represents and
warrants to the Trustee as follows
(with respect to the Closing Date
and any additional issuance):
(a) Immediately prior to the
transfer of the Securities to the
applicable Trust, the Depositor
owned and had good and marketable
title to the Securities free and
clear of any lien, claim or
encumbrance of any Person.
(b) The Depositor has received all
consents and approvals required by
the terms of the Securities to the
transfer to the Trustee of its
interest and rights in the
Securities as contemplated by the
Trust Agreements.
(c) The Depositor has not assigned,
pledged, sold, granted a security
interest in or otherwise conveyed
any interest in the Securities (or,
if any such interest has been
assigned, pledged or otherwise
encumbered, it has been released),
except such interests granted
pursuant to the Trust Agreements.
The Depositor has not authorized the
filing of and is not aware of any
financing statements against the
Depositor that includes a
description of the Securities, other
than any such filings pursuant to
the Trust Agreements. The Depositor
is not aware of any judgment or tax
lien filings against Depositor.
Other Terms: The Trust shall not merge or
consolidate with any other trust,
entity or person and the Trust shall
not acquire the assets of, or an
interest in, any other trust, entity
or person except as specifically
contemplated herein.
The Trustee shall provide to the
Unitholders and the Swap
Counterparties copies of any notices
it receives with respect to a
redemption of or self-tender offer
for the Securities or an exercise of
the call rights under the Swap
Agreement and any other notices with
respect to the Securities. The
Trustee shall provide to the Swap
Counterparty any notice from the
Securities Issuer regarding an early
redemption of or self-tender offer
for the Securities within two (2)
Business Days of receipt of such
notice.
The reference to "B2" in the
definition of Certificate in the
Standard Terms shall be replaced
with "Exhibit B2".
The reference to "Section 10.02(ix)"
in the definition of Available Funds
in the Standard Terms shall be
replaced with "Section
10.02(a)(ix)".
The reference to "Section 3.04" in
the definition of Unit Account in
the Standard Terms shall be replaced
with "Section 3.05".
The transfer by the Depositor to the
Trustee specified in Section 2.01(a)
of the Standard Terms shall be in
trust.
Section 2.06 of the Standard Terms
shall be incorporated herein by
inserting "cash in an amount equal
to the premium under the Swap
Agreement and" after the phrase
"constituting the Trust Property,"
therein.
The reference to "calendar day" in
the last sentence of Section 3.06 of
the Standard Terms shall be replaced
with "Business Day".
Section 4.02(d) of the Standard
Terms shall be incorporated herein
by striking "and the Trustee on
behalf of the Unitholders" from the
first sentence of the second
paragraph thereof.
Section 5.03(c) of the Standard
Terms shall be incorporated herein
by striking "(if so required by the
Trustee or the Unit Registrar)" from
the first sentence thereof.
Section 7.01(c)(i) of the Standard
Terms shall be incorporated herein
by replacing the first word thereof
("after") with "alter".
Section 7.01(c) of the Standard
Terms shall be incorporated herein
by inserting "(i)" between
"Securities" and "would" in the
clause that begins "and provided,
further," and adding at the end of
the same sentence "and (ii) will not
alter the classification of the
Trust for Federal income tax
purposes."
Section 7.02 of the Standard Terms
shall be incorporated herein by
striking "(i) the Trustee determines
that such amendment will not
adversely affect the interests of
the Unitholders and (ii)" from the
first sentence thereof, inserting
"on which it may conclusively rely"
after "Opinion of Counsel" in such
sentence, and striking "clause (ii)"
from the second sentence of such
Section.
For the avoidance of doubt, Section
9.03(c) of the Standard Terms shall
not be incorporated herein. For the
avoidance of doubt, the Securities
may not be distributed to
Unitholders under any circumstances,
other than to the Depositor
exercising exchangeable series
rights.
Section 9.03(i) of the Standard
Terms shall be incorporated herein
by striking "or oral" after the
phrase "at any time by" in the third
sentence thereof.
Clause (ix) of Section 10.02(a)
shall not apply.
Section 10.02(a)(x) of the Standard
Terms shall be replaced with the
following:
(x) the Trustee shall have the power
to sell the Securities and other
Trust Property, in accordance with
Article IX and XI, through the
Selling Agent or, if the Selling
Agent shall have resigned or
declined to sell some or all of the
Securities, any broker selected by
the Trustee (at the direction of the
Depositor) with reasonable care, in
an amount sufficient to pay any
amount due to the Swap Counterparty
under the Swap Agreement (including
Termination Payments) or
reimbursable to itself in respect of
unpaid Extraordinary Trust Expenses
and to use the proceeds thereof to
make such payments after the
distribution of funds or Trust
Property to Unitholders. Any such
broker shall be instructed by the
Trustee to sell such Trust Property
in a reasonable manner designed to
maximize the sale proceeds.
Section 10.05(b) of the Standard
Terms shall be incorporated herein
by replacing ", pursuant to the
first sentence of this paragraph"
with "the Trustee shall be
indemnified by the Trust, however,"
in the last sentence thereof.
Section 10.06(a) of the Standard
Terms shall be incorporated herein
by inserting "or association" after
the word "corporation" in the second
sentence thereof.
Section 10.07(a) of the Standard
Terms shall be incorporated herein
by replacing "notice or resignation"
with "notice of resignation" in the
second sentence thereof and striking
the last two sentences thereof.
Section 10.10(b) of the Standard
Terms shall be incorporated herein
by inserting "The Trustee shall not
be liable for the acts or omissions
of any co-trustee." after the last
sentence thereof.
Section 10.14 of the Standard Terms
shall be replaced with the
following:
SECTION 10.14. Non-Petition. Prior
to the date that is one year and one
day after all distributions in
respect of the Units have been made,
none of the Trustee, the Trust or
the Depositor shall take any action,
institute any proceeding, join in
any action or proceeding or
otherwise cause any action or
proceeding against any of the others
under the United States Bankruptcy
Code or any other liquidation,
insolvency, bankruptcy, moratorium,
reorganization or similar law
("Insolvency Law") applicable to any
of them, now or hereafter in effect,
or which would be reasonably likely
to cause any of the others to be
subject to, or seek the protection
of, any such Insolvency Law.
Section 12.01(a) of the Standard
Terms shall be incorporated herein
by replacing "(v)" with "(vi)" in
the last proviso thereof.
Section 12.01(c) of the Standard
Terms shall be incorporated herein
by inserting ", provided at the
expense of the party requesting such
amendment," after "Opinion of
Counsel".
Section 12.05 of the Standard Terms
shall be incorporated herein by
striking "the Trustee and" in the
last sentence of the second
paragraph thereof.
The reference to "its President, its
Treasurer, or one of its Vice
Presidents, Assistant Vice
Presidents or Trust Officers" in the
first sentence of Section 5.02(a) of
the Standard Terms shall be replaced
with "a Responsible Officer".
The reference to "the proper
officers" in the second sentence of
Section 5.02(a) of the Standard
Terms shall be replaced with "a
Responsible Officer".
The reference to "one of its
authorized signatories" in the first
sentence of Section 5.02(d) of the
Standard Terms shall be replaced
with "a Responsible Officer".
The reference to the "Trust" in the
first sentence of Section 5.08(b) of
the Standard Terms shall be replaced
with the "Trustee".
References to D&P in the Standard
Terms shall be incorporated as
references to Fitch Inc. ("Fitch").
Schedule II
(Terms of Trust Property)
Securities: American General Institutional
Capital A 7.570% trust preferred
capital securities due December 1,
2045
The Guarantor Debentures may be
distributed in exchange for the
Securities or in liquidation of the
Issuer. In such event the Guarantor
Debentures would become the
Securities under the Trust Agreement
Security Issuer: American General Institutional
Capital A
Security Guarantors: American General Corporation (the
"AGC Guarantor") and American
International Group, Inc. (the "AIG
Guarantor").
At the time of issuance, the
Securities constituted trust
preferred capital securities of the
AGC Guarantor and the Guarantor
Debentures were solely obligations
of the AGC Guarantor. The AGC
Guarantor is now a wholly owned
subsidiary of the AIG Guarantor
which as of November 2001 has
guaranteed the AGC Guarantor's
obligations with respect to the
Securities. The Security Issuer will
be considered an Eligible Issuer and
the Securities shall not be
considered Disqualified Securities
so long as the AGC Guarantor is a
wholly owned subsidiary (direct or
indirect) of an Eligible Issuer. So
long as the AIG Guarantor is the
parent company of the AGC Guarantor,
the AIG Guarantor will be considered
the "Security Issuer" for purposes
of determining whether the Security
Issuer is an Eligible Issuer and
whether the Securities are
Disqualified Securities.
Guarantor Debentures: The AGC Guarantor's 7.570% junior
subordinated debentures due December
1, 2045. Such debentures are the
only assets of the Security Issuer.
In the event that the Guarantor
Debentures are exchanged for the
Securities or distributed in
liquidation of the Security Issuer,
the Guarantor Debentures shall be
treated as the Securities and the
Security Guarantor shall be treated
as the Security Issuer. Such
exchange or liquidation shall not be
considered a redemption.
Principal Amount: $39,332,000
Security Rate: 7.570%
Credit Ratings: Aa1 by Moody's
AA by S&P
Listing: Not applicable
Security Agreement: As to the Securities, the Amended
and Restated Trust Agreement, dated
as of December 4, 1996, among the
AGC Guarantor as depositor, Bankers
Trust Company, as property trustee
(referred to herein as the property
trustee and also as the "Security
Trustee"), Bankers Trust (Delaware)
as Delaware trustee, Bankers Trust,
as amended and supplemented from
time to time. As to the Guarantor
Debentures, the indenture dated as
of December 1, 1996, between the AGC
Guarantor and Bankers Trust Company,
as trustee, as supplemented by the
First Supplemental Indenture dated
November 1, 2001, and as may be
further supplemented or amended from
time to time.
Form: Global
Currency of
Denomination: United States dollars
Acquisition Price by Trust: $45,861,372
Security Payment Date: Each June 1 and December 1
Original Issue Date: On or about December 4, 1996
Maturity Date: December 1, 2045
Redemption Terms: The Guarantor Debentures and the
Securities may be redeemed in
accordance with the terms of the
indenture and the Security
Agreement.
CUSIP No.:/ISIN No. 02637VAA6
Security Trustee: Bankers Trust Company
Guarantor Debenture Trustee: Bankers Trust Company
Available Information
Regarding the Security Issuer
(if other than U.S.
Treasury obligations): The AIG Guarantor is subject to the
informational requirements of the
Securities Exchange Act of 1934, as
amended, and in accordance therewith
files reports and other information
with the Securities and Exchange
Commission (the "Commission"). Such
reports and other information can be
inspected and copied at the public
reference facilities maintained by
the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 and at
the following Regional Offices of
the Commission: Woolworth Building,
233 Broadway, New York, New York
10279, and Northwest Atrium Center,
500 West Madison Street, Chicago,
Illinois 60661. Copies of such
materials can be obtained from the
Public Reference Section of the
Commission at 450 Fifth Street,
N.W., Washington, District of
Columbia 20549 at prescribed rates.
Schedule III
(Call Option Confirm)
- --------------------------------------------------------------------------------
Date: October 28, 2002
To: SATURNS Trust No. 2002-11 From: Morgan Stanley & Co.
International Limited
Attn: Asset-Backed Securities Group Contact: Chris Boas
SATURNS Trust No. 2002-11
Fax: 312-904-2084 Fax: 212-761-0406
Tel: 312-904-9387 Tel: 212-761-1395
- --------------------------------------------------------------------------------
Re: Bond Option Transaction. MS Reference Number SQ1TN
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between you and Morgan Stanley & Co.
International Limited ("MSIL"), with Morgan Stanley & Co. Incorporated
("MS&Co."), as agent, on the Trade Date specified below (the "Transaction").
This letter agreement constitutes a "Confirmation" as referred to in the
Agreement below.
The definitions and provisions contained in the 1997 ISDA Government
Bond Option Definitions as published by the International Swaps and Derivatives
Association, Inc. ("ISDA") are incorporated into this Confirmation and this
transaction shall be deemed a "Government Bond Option Transaction" for purposes
of such definitions. In the event of any inconsistency between those definitions
and this Confirmation, this Confirmation will govern.
1. This Confirmation supplements, forms a part of, and is subject to,
the ISDA Master Agreement dated as of the date hereof, as amended and
supplemented from time to time (the "Agreement"), between you and us. All
provisions contained in the Agreement govern this Confirmation except as
expressly modified below.
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
I. General Terms
Trade Date: October 9, 2002
Option Style: American
Option Type: Call
Buyer: MSIL ("Party A")
Seller: SATURNS Trust No. 2002-11 ("Party B")
Bonds: The obligation identified as follows:
Bond Issuer: American General
Institutional
Capital A
Issue: 7.570% trust
preferred capital
securities due 2045
CUSIP: 02637VAA6
Coupon: 7.570%
Maturity Date: December 1, 2045
Face Amount
Purchased: USD $39,332,000
If the junior subordinated
debentures underlying the Bonds
are distributed to Party B as
described in the trust agreement
for the Bonds, such underlying
junior subordinated debentures
shall be deemed to be the Bonds.
Premium: USD $98,330
Premium Payment Date: October 28, 2002
Number of Options: 39,332
Option Entitlement: USD 1,000 of face amount of the Bonds
per Option.
Strike Price: (i) For any Exercise Date prior to
October 28, 2007, in connection with a
self-tender offer by the Bond Issuer
for the Bonds held by the Trust, 106%
of the corresponding portion of the
aggregate Unit Principal Balance (as
defined in the Trust Agreement) but
exclusive of accrued interest on the
Bonds or (ii) for any other Exercise
Date, 100% of the face amount of the
Bonds exclusive of accrued interest.
Calculation Agent: Party A
II. Exercise Terms
Automatic Exercise: Inapplicable
Exercise Period: Any Business Day from, and including,
9:00 a.m. (New York time) on October
28, 2007, to, and including, the
Expiration Time on the Expiration
Date; provided, however, the Exercise
Period shall also include any Business
Day prior to October 28, 2007, if
notice of redemption or self-tender
has been delivered by the Bond Issuer
as to Bonds held by the Trust.
Exercise Date: For each Option exercised, the day
during the Exercise Period on which
that Option is exercised.
Rescission of Exercise: Party A may rescind its notice of
exercise at any time prior to the
Settlement Date.
If Cash Settlement applies and if
Party B cannot obtain a bid for
the Bonds held by it in excess of
the Strike Price together with
accrued interest on the Bonds,
then Party A's notice of exercise
shall be rescinded. If Cash
Settlement applies and Party A
exercises its Options in
connection with a self-tender for
settlement prior to October 28,
2007, Party A's notice of exercise
shall be automatically rescinded
if the price offered by the Bond
Issuer does not exceed the Strike
Price together with accrued
interest on the Bonds.
Upon any rescission of exercise
(whether pursuant to the foregoing
sentence or otherwise) the Options
for which notice of exercise was
given and for which exercise was
rescinded shall continue in full
force and effect without regard to
such provision of notice.
Multiple Exercise: Applicable
Minimum Number of Options: 1
Written Confirmation of Exercise: Applicable. Buyer shall give exercise
notice which may be given orally
(including by telephone) during the
Exercise Period but no later than the
Notification Date. Buyer will execute
and deliver a written exercise notice
confirming the substance of such oral
notice, however, failure to provide
such written notice will not affect
the validity of the oral notice.
Limitation on Rights of MSIL: Buyer may, by written notice thereof
to Seller, delegate its rights to
provide a notice of exercise hereunder
to a third party (the "Third Party").
Any such delegation will be
irrevocable by Buyer without the
written consent of the Third Party.
Any such Third Party will have the
same rights and obligations regarding
providing notice of exercise hereunder
as the Buyer had prior to such
delegation. While any such delegation
is effective, Seller will only
recognize a notice of exercise that is
provided by the Third Party.
Notification Date: The Swap Counterparty may give notice
of its intention to exercise the call
rights under the Swap Agreement on not
less than 15 or more than 60-calendar
days' notice. The Swap Counterparty
may give notice of its intention to
exercise its call rights under the
Swap Agreement with respect to Bonds
held by the Trust as to which the Bond
Issuer has given notice of its
intention to redeem or notice of a
self-tender with two business days
notice prior to the settlement of
exercise but no later than 4:00 p.m.
New York time on the second Business
Day immediately preceding the
scheduled settlement of the redemption
or self-tender.
Limited Right to Confirm Exercise: Inapplicable
Expiration Date: December 1, 2042
Expiration Time: 4:00 p.m. New York time
Business Days: New York and Chicago
III. Settlements:
Settlement: Cash Settlement if MSIL is Party A;
otherwise Physical Settlement. Party A
will notify Party B separately
regarding the clearance system details
for Physical Settlement.
Spot Price (Cash Settlement Only): The cash proceeds received by Party B
in connection with sale of the Bonds
by Party B, excluding any amounts in
respect of accrued interest. In the
event of a redemption or self-tender
by the Bond Issuer, the redemption
price or self tender price, as
applicable, paid by the Bond Issuer,
excluding accrued interest.
Deposit of Bond Payment
(Physical Settlement Only): Party A must deposit the Bond Payment
with the Trustee on the Business Day
prior to the Exercise Date. The Bonds
are to be delivered "free" to Party A.
Additional Payment Obligation of To the Expense Administrator (the
"Expense Administrator Payment
Obligation"):
Party A:
If the Bond Issuer has not given
notice of redemption in connection
with the exercise of Options
hereunder and if any such exercise
is an exercise of less than all
Options remaining unexercised
hereunder, Party A shall pay to
the Expense Administrator an
amount equal to the present value
of a stream of payments equal to
$6,048 payable on each payment
date for the Bonds until the
maturity of the Bonds discounted
at a rate of 6.0% per annum on the
basis of a 360 day year consisting
of twelve 30 day months from the
date of such exercise until the
Scheduled Final Distribution Date
(as defined in the Trust
Agreement), assuming for this
purpose that the Trust (as defined
in the Trust Agreement) is not
terminated prior to the Scheduled
Final Distribution Date,
multiplied by the Option
Entitlement multiplied by the
number of Options exercised and
divided by $39,332,000.
To Party B for Payment on the
Class B Units (the "Class B Unit
Payment Obligation"):
Upon any exercise hereunder, other
than an exercise of Options
occurring contemporaneously with a
redemption of the Bonds by the
Bond Issuer to the extent the
amount of Options exercised
corresponds with the amount of
Bonds held by Party B being
redeemed by the Bond Issuer, Party
A shall pay to Party B, for
distribution with respect to the
Class B Units, the present value
of the Future Class B Unit
Interest in respect of the Class B
Unit Corresponding Portion
discounted at a rate of 7.570% per
annum on the basis of a 360 day
year consisting of twelve 30 day
months.
Settlement Date: For Cash Settlement, as applicable,
the Business Day of settlement of the
sale of the Bonds by Party B or the
Business Day of settlement of a
redemption of Bonds by the Bond
Issuer. For Physical Settlement, the
Exercise Date.
3. Additional Definitions.
"Class B Unit" means the Class B Unit issued under the Trust Agreement.
"Class B Unit Corresponding Portion" means, at any time, a notional
amount of the Class B Units equal to the number of Options exercised at such
time multiplied by the Option Entitlement.
"Expense Administration Agreement" means the expense administration
agreement dated as of the date hereof between Party B and the Expense
Administrator.
"Expense Administrator" means MSDW Structured Asset Corp. acting
pursuant to the Expense Administration Agreement.
"Future Class B Unit Interest" means at any time and from time to time,
the interest on the Class B Unit Corresponding Portion, other than interest
accrued through the Settlement Date, that would have accrued at the rate and in
the manner specified in the Trust Agreement and would have been payable at the
times specified in the Trust Agreement had the rights to purchase the Bonds
hereunder not been exercised.
"Trust Agreement" means the trust agreement dated as of the date hereof
between the MSDW Structured Asset Corp. and LaSalle Bank National Association.
4. Representations. Morgan Stanley & Co. Incorporated is acting as
agent for both parties but does not guarantee the performance of Party A.
5. Additional Termination Event. As set forth in the Agreement, a Trust
Wind-Up Event will result in an Additional Termination Event under the Agreement
with respect to which Party B shall be the Affected Party and this Transaction
shall be an Affected Transaction. A redemption by the Bond Issuer of a portion
of the Bonds held by Party B will result in a partial Additional Termination
Event to the extent of the Bonds being so redeemed if Party A does not exercise
Options hereunder corresponding to such Bonds.
6. Swap Termination Payments. In the event an Early Termination Date is
designated with respect to which this Transaction is an Affected Transaction,
there shall be payable to Party A as a termination payment in lieu of the
termination payment determined in accordance with Section 6(e) of the Agreement
an amount equal to the excess (if any) of the sale proceeds (or redemption
proceeds), excluding accrued interest, of the Bonds in excess of, in the event
of a redemption of the bonds by the bond issuer, the Strike Price, or otherwise,
the aggregate outstanding Unit Principal Balance (as defined in the Trust
Agreement).
7. Assignment. The rights under this Confirmation and the Agreement may
be assigned at any time and from time to time in whole or in part; provided that
the Rating Agency Condition (as defined in the Trust Agreement) is satisfied
with respect to such assignment and any transfer. The transferee in any such
assignment or transfer must be a qualified institutional buyer as defined in
Rule 144A under the Securities Act of 1933, as amended.
8. Account Details.
Payments to Party A: Citibank, N.A., New York
SWIFT BIC Code: CITIUS33
ABA No. 021 000 089
FAO: Morgan Stanley & Co. International Limited
Account No. 3042-1519
Operations Contact: Barbara Kent
Tel 212-537-1449
Fax 212-537-1868
Payments to Party B: LaSalle Bank, Chicago, Illinois
ABA No. 071 000 505
Reference: SATURNS 2002-11
Unit Account / AC-2090067/
Account No.: 67-9098-400
Operations Contact: Andy Streepey
Tel: 312-904-9387
Fax: 312-904-2084
MORGAN STANLEY
Please confirm that the foregoing correctly sets forth the terms of our
agreement MS Reference Number SQ1TN by executing this Confirmation and returning
it to us.
Best Regards,
MORGAN STANLEY & CO. INTERNATIONAL LIMITED
BY: /s/ Chris Boas
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Name: Chris Boas
Title: Attorney in fact
Acknowledged and agreed as of the date first written above:
SATURNS TRUST NO. 2002-11
BY: LaSalle Bank National Association,
solely as Trustee and not in its individual capacity.
BY: /s/ Ann M. Kelly
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Name: Ann M. Kelly
Title: Assistant Vice-President
MORGAN STANLEY & CO. INCORPORATED hereby agrees to and
acknowledges its role as agent for both parties in accordance with
the Schedule to the Agreement.
BY: /s/ John Kehoe
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Name: John Kehoe
Title: Attorney in fact